WASHINGTON
|
31-1188630
|
|
(State
or other jurisdiction of
|
(I.R.S.
Employer
|
|
incorporation
or organization)
|
Identification
No.)
|
6800
CINTAS BOULEVARD
P.O.
BOX 625737
CINCINNATI,
OHIO 45262-5737
|
(Address
of principal executive offices)
(Zip
Code)
|
Large
Accelerated Filer þ
|
Accelerated
Filer o
|
Smaller
Reporting Company o
|
Non-Accelerated
Filer o (Do not
check if a smaller reporting company)
|
Class
|
Outstanding
September 30, 2008
|
|
Common
Stock, no par value
|
152,788,444
|
Page
No.
|
|||
Part I.
|
Financial
Information
|
||
Item
1.
|
Financial
Statements.
|
||
Consolidated
Condensed Statements of Income -
Three
Months Ended August 31, 2008 and 2007
|
3
|
||
Consolidated
Condensed Balance Sheets -
August
31, 2008 and May 31, 2008
|
4
|
||
Consolidated
Condensed Statements of Cash Flows -
Three
Months Ended August 31, 2008 and 2007
|
5
|
||
Notes
to Consolidated Condensed Financial Statements
|
6
|
||
Item
2.
|
Management's
Discussion and Analysis of Financial
Condition
and Results of Operations.
|
21
|
|
Item
3.
|
Quantitative
and Qualitative Disclosures About Market Risk.
|
28
|
|
Item
4.
|
Controls
and Procedures.
|
28
|
|
Part II.
|
Other
Information
|
30
|
|
Item
1.
|
Legal
Proceedings.
|
30
|
|
Item
2.
|
Unregistered
Sales of Equity Securities and Use of Proceeds.
|
30
|
|
Item
6.
|
Exhibits.
|
30
|
|
Signatures
|
31
|
||
Exhibits
|
|
Three
Months Ended
August
31,
|
||||||||
2008
|
2007
|
|||||||
Revenue:
|
||||||||
Rental uniforms and
ancillary products
|
$ | 721,373 | $ | 710,354 | ||||
Other
services
|
280,806 | 258,774 | ||||||
1,002,179 | 969,128 | |||||||
Costs
and expenses (income):
|
||||||||
Cost of rental
uniforms and ancillary products
|
407,290 | 391,490 | ||||||
Cost of other
services
|
169,806 | 160,266 | ||||||
Selling and
administrative expenses
|
287,295 | 276,710 | ||||||
Operating
income
|
137,788 | 140,662 | ||||||
Interest
income
|
(1,065 | ) | (1,462 | ) | ||||
Interest
expense
|
13,031 | 12,837 | ||||||
Income
before income taxes
|
125,822 | 129,287 | ||||||
Income
taxes
|
47,186 | 48,224 | ||||||
Net
income
|
$ | 78,636 | $ | 81,063 | ||||
Basic
earnings per share
|
$ | 0.51 | $ | 0.51 | ||||
Diluted
earnings per share
|
$ | 0.51 | $ | 0.51 |
August
31, 2008
|
May
31, 2008
|
||||||||
(Unaudited)
|
|||||||||
ASSETS
|
|||||||||
Current
assets:
|
|||||||||
Cash and cash
equivalents
|
$ | 58,243 | $ | 66,224 | |||||
Marketable
securities
|
122,652 | 125,471 | |||||||
Accounts
receivable, net
|
431,681 | 430,078 | |||||||
Inventories,
net
|
242,094 | 238,669 | |||||||
Uniforms and other
rental items in service
|
373,241 | 370,416 | |||||||
Deferred income tax
asset
|
40,656 | 39,410 | |||||||
Prepaid
expenses
|
18,381 | 12,068 | |||||||
Total
current assets
|
1,286,948 | 1,282,336 | |||||||
Property
and equipment, at cost, net
|
987,582 | 974,575 | |||||||
Goodwill
|
1,320,501 | 1,315,569 | |||||||
Service
contracts, net
|
146,197 | 152,757 | |||||||
Other
assets, net
|
85,371 | 83,364 | |||||||
$ | 3,826,599 | $ | 3,808,601 | ||||||
LIABILITIES AND
SHAREHOLDERS' EQUITY
|
|||||||||
Current
liabilities:
|
|||||||||
Accounts
payable
|
$ | 87,418 | $ | 94,755 | |||||
Accrued
compensation and related liabilities
|
33,778 | 50,605 | |||||||
Accrued
liabilities
|
176,053 | 207,925 | |||||||
Current income
taxes payable
|
45,657 | 12,887 | |||||||
Long-term debt due
within one year
|
957 | 1,070 | |||||||
Total
current liabilities
|
343,863 | 367,242 | |||||||
Long-term
liabilities:
|
|||||||||
Long-term debt due
after one year
|
949,588 | 942,736 | |||||||
Deferred income
taxes
|
123,425 | 124,184 | |||||||
Accrued
liabilities
|
118,872 | 120,308 | |||||||
Total
long-term liabilities
|
1,191,885 | 1,187,228 | |||||||
Shareholders'
equity:
|
|||||||||
Preferred stock, no
par value:
|
|||||||||
100,000
shares authorized, none outstanding
|
---- | ---- | |||||||
Common stock, no
par value:
|
|||||||||
425,000,000
shares authorized,
|
|||||||||
FY 2009: |
173,083,426
issued and 152,788,444 outstanding
|
||||||||
FY 2008: |
173,083,426 issued
and 153,691,103 outstanding
|
129,182 | 129,182 | ||||||
Paid-in
capital
|
63,943 | 60,408 | |||||||
Retained
earnings
|
2,862,938 | 2,784,302 | |||||||
Treasury
stock:
|
|||||||||
FY 2009: |
20,294,982
shares
|
(797,888 | ) | (772,041 | ) | ||||
FY 2008: |
19,392,323
shares
|
||||||||
Other accumulated
comprehensive income
|
32,676 | 52,280 | |||||||
Total
shareholders' equity
|
2,290,851 | 2,254,131 | |||||||
$ | 3,826,599 | $ | 3,808,601 |
Three
Months Ended
August
31,
|
||||||||
2008
|
2007
|
|||||||
Cash
flows from operating activities:
|
||||||||
Net
income
|
$ | 78,636 | $ | 81,063 | ||||
Adjustments to
reconcile net income to net cash provided by operating
activities:
|
||||||||
Depreciation
|
39,040 | 35,636 | ||||||
Amortization of
deferred charges
|
10,845 | 10,586 | ||||||
Stock-based
compensation
|
3,535 | 2,132 | ||||||
Deferred income
taxes
|
(1,482 | ) | 17,418 | |||||
Change
in current assets and liabilities, net of acquisitions of
businesses:
|
||||||||
Accounts
receivable, net
|
(3,369 | ) | 644 | |||||
Inventories,
net
|
(3,795 | ) | (4,293 | ) | ||||
Uniforms and other
rental items in service
|
(4,437 | ) | (7,128 | ) | ||||
Prepaid
expenses
|
(6,332 | ) | (2,117 | ) | ||||
Accounts
payable
|
(7,567 | ) | 5,435 | |||||
Accrued
compensation and related liabilities
|
(16,696 | ) | (28,386 | ) | ||||
Accrued liabilities
and other
|
(32,758 | ) | (77,926 | ) | ||||
Income taxes
payable
|
32,718 | 24,001 | ||||||
Net
cash provided by operating activities
|
88,338 | 57,065 | ||||||
Cash
flows from investing activities:
|
||||||||
Capital
expenditures
|
(54,461 | ) | (45,344 | ) | ||||
Proceeds from sale
or redemption of marketable securities
|
171 | 29,156 | ||||||
Purchase of
marketable securities and investments
|
(10,379 | ) | (6,237 | ) | ||||
Acquisitions of
businesses, net of cash acquired
|
(12,106 | ) | (32,630 | ) | ||||
Other
|
627 | 177 | ||||||
Net
cash used in investing activities
|
(76,148 | ) | (54,878 | ) | ||||
Cash
flows from financing activities:
|
||||||||
Proceeds from
issuance of debt
|
7,000 | 224,750 | ||||||
Repayment of
debt
|
(261 | ) | (225,282 | ) | ||||
Stock options
exercised
|
---- | 7,230 | ||||||
Repurchase of
common stock
|
(25,847 | ) | ---- | |||||
Other
|
287 | (3,465 | ) | |||||
Net
cash (used in) provided by financing activities
|
(18,821 | ) | 3,233 | |||||
Effect
of exchange rate changes on cash and cash equivalents
|
(1,350 | ) | 61 | |||||
Net
(decrease) increase in cash and cash equivalents
|
(7,981 | ) | 5,481 | |||||
Cash
and cash equivalents at beginning of period
|
66,224 | 35,360 | ||||||
Cash
and cash equivalents at end of period
|
$ | 58,243 | $ | 40,841 |
1.
|
Basis
of Presentation
|
2.
|
New
Accounting Standards
|
3.
|
Fair
Value Measurements
|
Level 1 –
|
Quoted
prices in active markets for identical assets or
liabilities.
|
Level 2 –
|
Observable
inputs other than quoted prices included in Level 1, such as quoted
prices for similar assets and liabilities in active markets; quoted prices
for identical or similar assets and liabilities in markets that are not
active; or other inputs that are observable or can be corroborated by
observable market data.
|
Level 3 –
|
Unobservable
inputs that are supported by little or no market activity and that are
significant to the fair value of the assets or liabilities. This includes
certain pricing models, discounted cash flow methodologies and similar
techniques that use significant unobservable
inputs.
|
As
of August 31, 2008
|
||||||||||||||||
Level 1
|
Level 2
|
Level 3
|
Fair Value
|
|||||||||||||
Cash
and cash equivalents
|
$ | 58,243 | $ | ---- | $ | ---- | $ | 58,243 | ||||||||
Marketable
securities, available-for-sale
|
122,652 | ---- | ---- | 122,652 | ||||||||||||
Total
assets at fair value
|
$ | 180,895 | $ | ---- | $ | ---- | $ | 180,895 |
4.
|
Earnings
per Share
|
Three
Months Ended
August
31,
|
||||||||
2008
|
2007
|
|||||||
Numerator:
|
||||||||
Net
income
|
$ | 78,636 | $ | 81,063 | ||||
Denominator:
|
||||||||
Denominator
for basic earnings per share-weighted
average shares (000’s)
|
153,394 | 158,771 | ||||||
Effect
of dilutive securities- employee
stock options (000’s)
|
227 | 267 | ||||||
|
||||||||
Denominator
for diluted earnings per share-adjusted
weighted average
shares
and assumed conversions (000’s)
|
153,621 | 159,038 | ||||||
Basic
earnings per share
|
$ | 0.51 | $ | 0.51 | ||||
Diluted
earnings per share
|
$ | 0.51 | $ | 0.51 |
5.
|
Goodwill,
Service Contracts and Other Assets
|
Rental
Uniforms
&
Ancillary
Products
|
Uniform Direct |
First
Aid, Safety
& |
Document Management |
Total
|
||||||||||||||||
Goodwill
|
||||||||||||||||||||
Balance
as of June 1, 2008
|
$ | 863,581 | $ | 23,956 | $ | 165,544 | $ | 262,488 | $ | 1,315,569 | ||||||||||
Goodwill
acquired
|
--- | --- | 82 | 7,170 | 7,252 | |||||||||||||||
Foreign
currency translation
|
(1,185 | ) | (74 | ) | --- | (1,061 | ) | (2,320 | ) | |||||||||||
Balance
as of August 31, 2008
|
$ | 862,396 | $ | 23,882 | $ | 165,626 | $ | 268,597 | $ | 1,320,501 |
Rental
Uniforms
&
Ancillary
Products
|
Uniform Direct |
First
Aid, Safety
& |
Document Management |
Total
|
||||||||||||||||
Service
Contracts
|
||||||||||||||||||||
Balance
as of June 1, 2008
|
$ | 84,574 | $ | 328 | $ | 41,944 | $ | 25,911 | $ | 152,757 | ||||||||||
Service
contracts acquired
|
--- | --- | 249 | 1,735 | 1,984 | |||||||||||||||
Service
contracts amortization
|
(3,206 | ) | (65 | ) | (1,558 | ) | (1,859 | ) | (6,688 | ) | ||||||||||
Foreign
currency translation
|
(1,662 | ) | (28 | ) | --- | (166 | ) | (1,856 | ) | |||||||||||
Balance
as of August 31, 2008
|
$ | 79,706 | $ | 235 | $ | 40,635 | $ | 25,621 | $ | 146,197 |
As
of August 31, 2008
|
||||||||||||
Carrying
Amount
|
Accumulated Amortization |
Net
|
||||||||||
Service
contracts
|
$ | 333,671 | $ | 187,474 | $ | 146,197 | ||||||
Noncompete
and
consulting
agreements
|
$ | 64,234 | $ | 37,094 | $ | 27,140 | ||||||
Investments
|
50,649 | ---- | 50,649 | |||||||||
Other
|
10,475 | 2,893 | 7,582 | |||||||||
Total
|
$ | 125,358 | $ | 39,987 | $ | 85,371 |
As
of May 31, 2008
|
||||||||||||
Carrying Amount |
Accumulated Amortization |
Net
|
||||||||||
Service
contracts
|
$ | 333,543 | $ | 180,786 | $ | 152,757 | ||||||
Noncompete
and consulting agreements
|
$ | 63,894 | $ | 34,625 | $ | 29,269 | ||||||
Investments
|
46,012 | ---- | 46,012 | |||||||||
Other
|
10,790 | 2,707 | 8,083 | |||||||||
Total
|
$ | 120,696 | $ | 37,332 | $ | 83,364 |
6.
|
Debt,
Derivatives and Hedging Activities
|
7.
|
Income
Taxes
|
8.
|
Comprehensive
Income
|
Three
Months Ended
August
31,
|
||||||||
2008
|
2007
|
|||||||
Net
income
|
$ | 78,636 | $ | 81,063 | ||||
Other
comprehensive income:
|
||||||||
Foreign currency
translation adjustment
|
(19,813 | ) | 2,813 | |||||
Amortization of
interest rate lock agreements
|
192 | 69 | ||||||
Change in fair
value of available-for-sale securities
|
17 | 145 | ||||||
Comprehensive
income
|
$ | 59,032 | $ | 84,090 |
9.
|
Litigation
and Other Contingencies
|
10.
|
Segment
Information
|
Rental Uniforms
&Ancillary Products |
Uniform Direct |
First
Aid, Safety
& |
Document Management |
Corporate
|
Total
|
|||||||||||||||||||
As of and for the
three months ended
August 31, 2008
|
||||||||||||||||||||||||
Revenue
|
$ | 721,373 | $ | 117,483 | $ | 108,532 | $ | 54,791 | $ | ---- | $ | 1,002,179 | ||||||||||||
Income (loss) before
income
taxes
|
$ | 107,059 | $ | 12,003 | $ | 11,350 | $ | 7,376 | $ | (11,966 | ) | $ | 125,822 | |||||||||||
Total
assets
|
$ | 2,641,223 | $ | 191,101 | $ | 352,932 | $ | 460,448 | $ | 180,895 | $ | 3,826,599 | ||||||||||||
As of and for the
three months ended
August 31, 2007
|
||||||||||||||||||||||||
|
||||||||||||||||||||||||
Revenue
|
$ | 710,354 | $ | 118,805 | $ | 102,256 | $ | 37,713 | $ | ---- | $ | 969,128 | ||||||||||||
Income
(loss) before income taxes
|
$ | 114,793 | $ | 11,127 | $ | 10,621 | $ | 4,121 | $ | (11,375 | ) | $ | 129,287 | |||||||||||
Total
assets
|
$ | 2,592,401 | $ | 182,278 | $ | 332,757 | $ | 375,122 | $ | 138,272 | $ | 3,620,830 |
11.
|
Supplemental
Guarantor Information
|
Cintas
Corporation
|
Corp.
2
|
Subsidiary
Guarantors
|
Non-Guarantors
|
Eliminations
|
Cintas
Corporation Consolidated
|
|||||||||||||||||||
Revenue:
|
||||||||||||||||||||||||
Rental uniforms and
ancillary products
|
$ | ---- | $ | 536,768 | $ | 150,071 | $ | 50,264 | $ | (15,730 | ) | $ | 721,373 | |||||||||||
Other
services
|
---- | 359,179 | 121,131 | 16,654 | (216,158 | ) | 280,806 | |||||||||||||||||
Equity in net
income of affiliates
|
78,636 | ---- | ---- | ---- | (78,636 | ) | ---- | |||||||||||||||||
78,636 | 895,947 | 271,202 | 66,918 | (310,524 | ) | 1,002,179 | ||||||||||||||||||
Costs
and expenses (income):
|
||||||||||||||||||||||||
Cost of rental
uniforms and ancillary products
|
---- | 326,877 | 92,890 | 30,282 | (42,759 | ) | 407,290 | |||||||||||||||||
Cost of other
services
|
---- | 244,711 | 106,080 | 10,438 | (191,423 | ) | 169,806 | |||||||||||||||||
Selling and
administrative expenses
|
---- | 287,190 | (16,196 | ) | 16,823 | (522 | ) | 287,295 | ||||||||||||||||
Operating
income
|
78,636 | 37,169 | 88,428 | 9,375 | (75,820 | ) | 137,788 | |||||||||||||||||
Interest
income
|
---- | ---- | (248 | ) | (817 | ) | ---- | (1,065 | ) | |||||||||||||||
Interest expense
(income)
|
---- | 13,465 | (437 | ) | 3 | ---- | 13,031 | |||||||||||||||||
Income
before income taxes
|
78,636 | 23,704 | 89,113 | 10,189 | (75,820 | ) | 125,822 | |||||||||||||||||
Income
taxes
|
---- | 9,240 | 34,738 | 3,208 | ---- | 47,186 | ||||||||||||||||||
Net
income
|
$ | 78,636 | $ | 14,464 | $ | 54,375 | $ | 6,981 | $ | (75,820 | ) | $ | 78,636 |
Cintas
Corporation
|
Corp.
2
|
Subsidiary
Guarantors
|
Non-Guarantors
|
Eliminations
|
Cintas
Corporation Consolidated
|
|||||||||||||||||||
Revenue:
|
||||||||||||||||||||||||
Rental uniforms and
ancillary products
|
$ | ---- | $ | 517,963 | $ | 145,280 | $ | 47,351 | $ | (240 | ) | $ | 710,354 | |||||||||||
Other
services
|
---- | 346,887 | 137,805 | 13,141 | (239,059 | ) | 258,774 | |||||||||||||||||
Equity in net
income of affiliates
|
81,063 | ---- | ---- | ---- | (81,063 | ) | ---- | |||||||||||||||||
81,063 | 864,850 | 283,085 | 60,492 | (320,362 | ) | 969,128 | ||||||||||||||||||
Costs
and expenses (income):
|
||||||||||||||||||||||||
Cost of rental
uniforms and ancillary products
|
---- | 321,273 | 86,957 | 27,857 | (44,597 | ) | 391,490 | |||||||||||||||||
Cost of other
services
|
---- | 228,740 | 117,776 | 8,417 | (194,667 | ) | 160,266 | |||||||||||||||||
Selling and
administrative expenses
|
---- | 217,225 | 48,978 | 11,927 | (1,420 | ) | 276,710 | |||||||||||||||||
Operating
income
|
81,063 | 97,612 | 29,374 | 12,291 | (79,678 | ) | 140,662 | |||||||||||||||||
Interest
income
|
---- | ---- | (333 | ) | (1,129 | ) | ---- | (1,462 | ) | |||||||||||||||
Interest expense
(income)
|
---- | 12,869 | (1,518 | ) | 1,486 | ---- | 12,837 | |||||||||||||||||
Income
before income taxes
|
81,063 | 84,743 | 31,225 | 11,934 | (79,678 | ) | 129,287 | |||||||||||||||||
Income
taxes
|
---- | 32,128 | 11,838 | 4,258 | ---- | 48,224 | ||||||||||||||||||
Net
income
|
$ | 81,063 | $ | 52,615 | $ | 19,387 | $ | 7,676 | $ | (79,678 | ) | $ | 81,063 |
Cintas
Corporation
|
Corp.
2
|
Subsidiary
Guarantors
|
Non-Guarantors
|
Eliminations
|
Cintas
Corporation Consolidated
|
|||||||||||||||||||
Assets
|
||||||||||||||||||||||||
Current
assets:
|
||||||||||||||||||||||||
Cash and cash
equivalents
|
$ | ---- | $ | 32,315 | $ | 6,450 | $ | 19,478 | $ | ---- | $ | 58,243 | ||||||||||||
Marketable
securities
|
---- | ---- | ---- | 122,652 | ---- | 122,652 | ||||||||||||||||||
Accounts
receivable, net
|
---- | 320,804 | 113,728 | 27,043 | (29,894 | ) | 431,681 | |||||||||||||||||
Inventories,
net
|
---- | 221,524 | 16,714 | 9,349 | (5,493 | ) | 242,094 | |||||||||||||||||
Uniforms and other
rental items in service
|
---- | 289,849 | 86,253 | 23,300 | (26,161 | ) | 373,241 | |||||||||||||||||
Deferred income tax
asset (liability)
|
---- | ---- | 42,763 | (2,107 | ) | ---- | 40,656 | |||||||||||||||||
Prepaid
expenses
|
---- | 5,838 | 11,330 | 1,213 | ---- | 18,381 | ||||||||||||||||||
Total
current assets
|
---- | 870,330 | 277,238 | 200,928 | (61,548 | ) | 1,286,948 | |||||||||||||||||
Property
and equipment, at cost, net
|
---- | 675,912 | 253,733 | 57,937 | ---- | 987,582 | ||||||||||||||||||
Goodwill
|
---- | ---- | 1,287,070 | 33,431 | ---- | 1,320,501 | ||||||||||||||||||
Service
contracts, net
|
---- | 139,483 | 2,361 | 4,353 | ---- | 146,197 | ||||||||||||||||||
Other
assets, net
|
1,792,928 | 1,599,153 | 1,788,921 | 338,800 | (5,434,431 | ) | 85,371 | |||||||||||||||||
$ | 1,792,928 | $ | 3,284,878 | $ | 3,609,323 | $ | 635,449 | $ | (5,495,979 | ) | $ | 3,826,599 | ||||||||||||
Liabilities
and Shareholders' Equity
|
||||||||||||||||||||||||
Current
liabilities:
|
||||||||||||||||||||||||
Accounts
(receivable) payable
|
$ | (465,247 | ) | $ | 240,641 | $ | 295,417 | $ | (2,265 | ) | $ | 18,872 | $ | 87,418 | ||||||||||
Accrued
compensation and related liabilities
|
---- | 22,515 | 9,737 | 1,526 | ---- | 33,778 | ||||||||||||||||||
Accrued
liabilities
|
---- | 41,726 | 127,079 | 7,293 | (45 | ) | 176,053 | |||||||||||||||||
Current income
taxes payable (receivable)
|
---- | 5,272 | 42,164 | (1,779 | ) | ---- | 45,657 | |||||||||||||||||
Long-term debt due
within one year
|
---- | 721 | 455 | ---- | (219 | ) | 957 | |||||||||||||||||
Total
current liabilities
|
(465,247 | ) | 310,875 | 474,852 | 4,775 | 18,608 | 343,863 | |||||||||||||||||
Long-term
liabilities:
|
||||||||||||||||||||||||
Long-term debt due
after one year
|
---- | 959,281 | 841 | 24,840 | (35,374 | ) | 949,588 | |||||||||||||||||
Deferred income
taxes
|
---- | ---- | 118,093 | 5,332 | ---- | 123,425 | ||||||||||||||||||
Accrued
liabilities
|
---- | ---- | 118,872 | ---- | ---- | 118,872 | ||||||||||||||||||
Total
long-term liabilities
|
---- | 959,281 | 237,806 | 30,172 | (35,374 | ) | 1,191,885 | |||||||||||||||||
Total
shareholders’ equity
|
2,258,175 | 2,014,722 | 2,896,665 | 600,502 | (5,479,213 | ) | 2,290,851 | |||||||||||||||||
$ | 1,792,928 | $ | 3,284,878 | $ | 3,609,323 | $ | 635,449 | $ | (5,495,979 | ) | $ | 3,826,599 |
Cintas
Corporation
|
Corp.
2
|
Subsidiary
Guarantors
|
Non-Guarantors
|
Eliminations
|
Cintas
Corporation Consolidated
|
|||||||||||||||||||
Assets
|
||||||||||||||||||||||||
Current
assets:
|
||||||||||||||||||||||||
Cash and cash
equivalents
|
$ | ---- | $ | 36,627 | $ | 7,851 | $ | 21,746 | $ | ---- | $ | 66,224 | ||||||||||||
Marketable
securities
|
---- | ---- | ---- | 125,471 | ---- | 125,471 | ||||||||||||||||||
Accounts
receivable, net
|
---- | 312,424 | 119,592 | 29,329 | (31,267 | ) | 430,078 | |||||||||||||||||
Inventories,
net
|
---- | 218,109 | 18,349 | 8,928 | (6,717 | ) | 238,669 | |||||||||||||||||
Uniforms and other
rental items in service
|
---- | 288,097 | 85,753 | 24,319 | (27,753 | ) | 370,416 | |||||||||||||||||
Deferred income tax
asset (liability)
|
---- | ---- | 41,664 | (2,254 | ) | ---- | 39,410 | |||||||||||||||||
Prepaid
expenses
|
---- | 5,038 | 5,876 | 1,154 | ---- | 12,068 | ||||||||||||||||||
Total
current assets
|
---- | 860,295 | 279,085 | 208,693 | (65,737 | ) | 1,282,336 | |||||||||||||||||
Property
and equipment, at cost, net
|
---- | 675,559 | 236,519 | 62,497 | ---- | 974,575 | ||||||||||||||||||
Goodwill
|
---- | ---- | 1,279,819 | 35,750 | ---- | 1,315,569 | ||||||||||||||||||
Service
contracts, net
|
---- | 145,115 | 2,612 | 5,030 | ---- | 152,757 | ||||||||||||||||||
Other
assets, net
|
1,736,604 | 1,601,661 | 1,758,268 | 369,232 | (5,382,401 | ) | 83,364 | |||||||||||||||||
$ | 1,736,604 | $ | 3,282,630 | $ | 3,556,303 | $ | 681,202 | $ | (5,448,138 | ) | $ | 3,808,601 | ||||||||||||
Liabilities
and Shareholders' Equity
|
||||||||||||||||||||||||
Current
liabilities:
|
||||||||||||||||||||||||
Accounts
(receivable) payable
|
$ | (465,247 | ) | $ | 289,695 | $ | 255,399 | $ | (3,668 | ) | $ | 18,576 | $ | 94,755 | ||||||||||
Accrued
compensation and related liabilities
|
---- | 29,869 | 18,210 | 2,526 | ---- | 50,605 | ||||||||||||||||||
Accrued
liabilities
|
---- | 54,113 | 146,669 | 8,063 | (920 | ) | 207,925 | |||||||||||||||||
Current income
taxes (receivable) payable
|
---- | (75 | ) | 12,686 | 276 | ---- | 12,887 | |||||||||||||||||
Long-term debt due
within one year
|
---- | 698 | 574 | ---- | (202 | ) | 1,070 | |||||||||||||||||
Total
current liabilities
|
(465,247 | ) | 374,300 | 433,538 | 7,197 | 17,454 | 367,242 | |||||||||||||||||
Long-term
liabilities:
|
||||||||||||||||||||||||
Long-term debt due
after one year
|
---- | 952,595 | 893 | 27,213 | (37,965 | ) | 942,736 | |||||||||||||||||
Deferred income
taxes
|
---- | ---- | 118,479 | 5,705 | ---- | 124,184 | ||||||||||||||||||
Accrued
liabilities
|
---- | ---- | 120,308 | ---- | ---- | 120,308 | ||||||||||||||||||
Total
long-term liabilities
|
---- | 952,595 | 239,680 | 32,918 | (37,965 | ) | 1,187,228 | |||||||||||||||||
Total
shareholders’ equity
|
2,201,851 | 1,955,735 | 2,883,085 | 641,087 | (5,427,627 | ) | 2,254,131 | |||||||||||||||||
$ | 1,736,604 | $ | 3,282,630 | $ | 3,556,303 | $ | 681,202 | $ | (5,448,138 | ) | $ | 3,808,601 |
Cintas
Corporation
|
Corp.
2
|
Subsidiary
Guarantors
|
Non-Guarantors
|
Eliminations
|
Cintas
Corporation Consolidated
|
|||||||||||||||||||
Cash
flows from operating activities:
|
||||||||||||||||||||||||
Net
income
|
$ | 78,636 | $ | 14,464 | $ | 54,375 | $ | 6,981 | $ | (75,820 | ) | $ | 78,636 | |||||||||||
Adjustments to
reconcile net income to
net cash
provided by operating activities:
|
||||||||||||||||||||||||
Depreciation
|
---- | 24,623 | 12,190 | 2,227 | ---- | 39,040 | ||||||||||||||||||
Amortization of
deferred charges
|
---- | 10,026 | 297 | 522 | ---- | 10,845 | ||||||||||||||||||
Stock-based
compensation
|
3,535 | ---- | ---- | ---- | ---- | 3,535 | ||||||||||||||||||
Deferred income
taxes
|
---- | ---- | (1,482 | ) | ---- | ---- | (1,482 | ) | ||||||||||||||||
Changes in current
assets and liabilities,
net of
acquisitions of businesses:
|
||||||||||||||||||||||||
Accounts
receivable, net
|
---- | (8,101 | ) | 5,863 | 242 | (1,373 | ) | (3,369 | ) | |||||||||||||||
Inventories,
net
|
---- | (3,399 | ) | 1,634 | (806 | ) | (1,224 | ) | (3,795 | ) | ||||||||||||||
Uniforms and other
rental items in service
|
---- | (1,752 | ) | (500 | ) | (593 | ) | (1,592 | ) | (4,437 | ) | |||||||||||||
Prepaid
expenses
|
---- | (800 | ) | (5,454 | ) | (78 | ) | ---- | (6,332 | ) | ||||||||||||||
Accounts
payable
|
---- | (41,803 | ) | 32,753 | 1,187 | 296 | (7,567 | ) | ||||||||||||||||
Accrued
compensation and related
liabilities
|
---- | (7,354 | ) | (8,473 | ) | (869 | ) | ---- | (16,696 | ) | ||||||||||||||
Accrued liabilities
and other
|
---- | (12,185 | ) | (21,013 | ) | (435 | ) | 875 | (32,758 | ) | ||||||||||||||
Income taxes
payable
|
---- | 49,870 | (15,046 | ) | (2,106 | ) | ---- | 32,718 | ||||||||||||||||
Net
cash provided by operating activities
|
82,171 | 23,589 | 55,144 | 6,272 | (78,838 | ) | 88,338 | |||||||||||||||||
Cash
flows from investing activities:
|
||||||||||||||||||||||||
Capital
expenditures
|
---- | (23,183 | ) | (29,565 | ) | (1,713 | ) | ---- | (54,461 | ) | ||||||||||||||
Proceeds from sale
or redemption of marketable securities
|
---- | ---- | ---- | 171 | ---- | 171 | ||||||||||||||||||
Purchase of
marketable securities and investments
|
---- | 506 | 15,419 | (5,742 | ) | (20,562 | ) | (10,379 | ) | |||||||||||||||
Acquisitions of
businesses, net of cash acquired
|
---- | (12,106 | ) | ---- | ---- | ---- | (12,106 | ) | ||||||||||||||||
Other
|
(56,324 | ) | (19 | ) | (39,855 | ) | (1 | ) | 96,826 | 627 | ||||||||||||||
Net
cash used in investing activities
|
(56,324 | ) | (34,802 | ) | (54,001 | ) | (7,285 | ) | 76,264 | (76,148 | ) | |||||||||||||
Cash
flows from financing activities:
|
||||||||||||||||||||||||
Proceeds from
issuance of debt
|
---- | 7,000 | ---- | ---- | ---- | 7,000 | ||||||||||||||||||
Repayment of
debt
|
---- | (291 | ) | (2,544 | ) | ---- | 2,574 | (261 | ) | |||||||||||||||
Repurchase of
common stock
|
(25,847 | ) | ---- | ---- | ---- | ---- | (25,847 | ) | ||||||||||||||||
Other
|
---- | 192 | ---- | 95 | ---- | 287 | ||||||||||||||||||
Net
cash (used in) provided by financing activities
|
(25,847 | ) | 6,901 | (2,544 | ) | 95 | 2,574 | (18,821 | ) | |||||||||||||||
Effect
of exchange rate changes on cash and
cash
equivalents
|
---- | ---- | ---- | (1,350 | ) | ---- | (1,350 | ) | ||||||||||||||||
Net
decrease in cash and cash equivalents
|
---- | (4,312 | ) | (1,401 | ) | (2,268 | ) | ---- | (7,981 | ) | ||||||||||||||
Cash
and cash equivalents at beginning of period
|
---- | 36,627 | 7,851 | 21,746 | ---- | 66,224 | ||||||||||||||||||
Cash
and cash equivalents at end of period
|
$ | ---- | $ | 32,315 | $ | 6,450 | $ | 19,478 | $ | ---- | $ | 58,243 |
Cintas
Corporation
|
Corp.
2
|
Subsidiary
Guarantors
|
Non-Guarantors
|
Eliminations
|
Cintas
Corporation Consolidated
|
|||||||||||||||||||
Cash
flows from operating activities:
|
||||||||||||||||||||||||
Net
income
|
$ | 81,063 | $ | 52,615 | $ | 19,387 | $ | 7,676 | $ | (79,678 | ) | $ | 81,063 | |||||||||||
Adjustments to
reconcile net income to
net cash
provided by (used in) operating activities:
|
||||||||||||||||||||||||
Depreciation
|
---- | 22,488 | 11,244 | 1,904 | ---- | 35,636 | ||||||||||||||||||
Amortization of
deferred charges
|
---- | 9,784 | 338 | 464 | ---- | 10,586 | ||||||||||||||||||
Stock-based
compensation
|
2,132 | ---- | ---- | ---- | ---- | 2,132 | ||||||||||||||||||
Deferred income
taxes
|
---- | ---- | 17,418 | ---- | ---- | 17,418 | ||||||||||||||||||
Changes in current
assets and liabilities,
net of
acquisitions of
businesses:
|
||||||||||||||||||||||||
Accounts
receivable, net
|
---- | (3,286 | ) | 2,489 | 1,493 | (52 | ) | 644 | ||||||||||||||||
Inventories,
net
|
---- | (6,704 | ) | 3,252 | (68 | ) | (773 | ) | (4,293 | ) | ||||||||||||||
Uniforms and other
rental items in
service
|
---- | (4,742 | ) | (1,998 | ) | 224 | (612 | ) | (7,128 | ) | ||||||||||||||
Prepaid
expenses
|
---- | (182 | ) | (2,288 | ) | 353 | ---- | (2,117 | ) | |||||||||||||||
Accounts
payable
|
---- | (86,870 | ) | 86,759 | 6,572 | (1,026 | ) | 5,435 | ||||||||||||||||
Accrued
compensation and related
liabilities
|
---- | (16,067 | ) | (10,745 | ) | (1,574 | ) | ---- | (28,386 | ) | ||||||||||||||
Accrued liabilities
and other
|
---- | (28,949 | ) | (48,796 | ) | (1,071 | ) | 890 | (77,926 | ) | ||||||||||||||
Income taxes
payable
|
---- | 5,595 | 18,790 | (384 | ) | ---- | 24,001 | |||||||||||||||||
Net
cash provided by (used in) operating activities
|
83,195 | (56,318 | ) | 95,850 | 15,589 | (81,251 | ) | 57,065 | ||||||||||||||||
Cash
flows from investing activities:
|
||||||||||||||||||||||||
Capital
expenditures
|
---- | (29,680 | ) | (13,658 | ) | (2,006 | ) | ---- | (45,344 | ) | ||||||||||||||
Proceeds from sale
or redemption of marketable
securities
|
---- | ---- | 29,156 | ---- | ---- | 29,156 | ||||||||||||||||||
Purchase of
marketable securities and investments
|
---- | (440 | ) | (3,969 | ) | (4,650 | ) | 2,822 | (6,237 | ) | ||||||||||||||
Acquisitions of
businesses, net of cash acquired
|
---- | (22,949 | ) | ---- | (9,681 | ) | ---- | (32,630 | ) | |||||||||||||||
Other
|
(86,926 | ) | 108,611 | (100,070 | ) | ---- | 78,562 | 177 | ||||||||||||||||
Net
cash (used in) provided by investing activities
|
(86,926 | ) | 55,542 | (88,541 | ) | (16,337 | ) | 81,384 | (54,878 | ) | ||||||||||||||
Cash
flows from financing activities:
|
||||||||||||||||||||||||
Proceeds from
issuance of debt
|
---- | 224,750 | ---- | ---- | ---- | 224,750 | ||||||||||||||||||
Repayment of
debt
|
---- | (225,314 | ) | 165 | ---- | (133 | ) | (225,282 | ) | |||||||||||||||
Stock options
exercised
|
7,230 | ---- | ---- | ---- | ---- | 7,230 | ||||||||||||||||||
Other
|
(3,499 | ) | 69 | ---- | (35 | ) | ---- | (3,465 | ) | |||||||||||||||
Net
cash provided by (used in) financing activities
|
3,731 | (495 | ) | 165 | (35 | ) | (133 | ) | 3,233 | |||||||||||||||
Effect
of exchange rate changes on cash and
cash
equivalents
|
---- | ---- | ---- | 61 | ---- | 61 | ||||||||||||||||||
Net
(decrease) increase in cash and cash equivalents
|
---- | (1,271 | ) | 7,474 | (722 | ) | ---- | 5,481 | ||||||||||||||||
Cash
and cash equivalents at beginning of period
|
---- | 33,949 | (24,834 | ) | 26,245 | ---- | 35,360 | |||||||||||||||||
Cash
and cash equivalents at end of period
|
$ | ---- | $ | 32,678 | $ | (17,360 | ) | $ | 25,523 | $ | ---- | $ | 40,841 |
(In
thousands)
|
Payments
Due by Period
|
|||||||||||||||||||
Two
to
|
||||||||||||||||||||
One
year
|
three
|
Four
to
|
After
five
|
|||||||||||||||||
Long-term
contractual obligations
|
Total
|
or
less
|
years
|
five
years
|
Years
|
|||||||||||||||
Long-term
debt (1)
|
$ | 949,532 | $ | 544 | $ | 171,198 | $ | 226,291 | $ | 551,499 | ||||||||||
Capital
lease obligations (2)
|
1,013 | 413 | 240 | 240 | 120 | |||||||||||||||
Operating
leases (3)
|
84,812 | 23,131 | 32,970 | 16,504 | 12,207 | |||||||||||||||
Interest
payments (4)
|
698,973 | 53,854 | 104,830 | 81,138 | 459,151 | |||||||||||||||
Interest
swap agreements (5)
|
---- | ---- | ---- | ---- | ---- | |||||||||||||||
Unconditional
purchase obligations
|
---- | ---- | ---- | ---- | ---- | |||||||||||||||
Total
contractual cash obligations
|
$ | 1,734,330 | $ | 77,942 | $ | 309,238 | $ | 324,173 | $ | 1,022,977 |
(1)
|
Long-term
debt primarily consists of $775,000 in long-term notes and $170,000 in
commercial paper.
|
(2)
|
Capital
lease obligations are classified as debt on the consolidated balance
sheets.
|
(3)
|
Operating
leases consist primarily of building leases and a synthetic lease on a
corporate aircraft.
|
(4)
|
Interest
payments include interest on both fixed and variable rate
debt. Rates have been assumed to remain constant for the
remainder of fiscal 2009, increase 25 basis points each year in fiscal
2010 and fiscal 2011, and increase 50 basis points each year in fiscal
2012, fiscal 2013 and fiscal 2014.
|
(5)
|
Reference
Note 6 entitled Debt, Derivatives and Hedging Activities of “Notes to
Consolidated Condensed Financial Statements” for a detailed discussion of
interest swap agreements.
|
(In
thousands)
|
Amount
of Commitment Expiration Per Period
|
|||||||||||||||||||
Two
to
|
||||||||||||||||||||
One
year
|
three
|
Four
to
|
After
five
|
|||||||||||||||||
Other
commercial commitments
|
Total
|
or
less
|
years
|
five
years
|
Years
|
|||||||||||||||
Lines
of credit (1)
|
$ | 526,349 | $ | ---- | $ | 526,349 | $ | ---- | $ | ---- | ||||||||||
Standby
letter of credit (2)
|
73,651 | 73,642 | 9 | ---- | ---- | |||||||||||||||
Guarantees
|
---- | ---- | ---- | ---- | ---- | |||||||||||||||
Standby
repurchase obligations
|
---- | ---- | ---- | ---- | ---- | |||||||||||||||
Other
commercial commitments
|
---- | ---- | ---- | ---- | ---- | |||||||||||||||
Total
commercial commitments
|
$ | 600,000 | $ | 73,642 | $ | 526,358 | $ | ---- | $ | ---- |
(1)
|
Back-up
facility for the commercial paper
program.
|
(2)
|
Support
certain outstanding long-term debt and self-insured workers' compensation
and general liability insurance
programs.
|
Period
|
Total
number of shares purchased
|
Average
price paid per share
|
Total
number of shares purchased as part of the publicly announced
plan
|
Maximum
approximate dollar value of shares that may yet be purchased under the
plan
|
||||||||||||
June
2008
|
---- | ---- | ---- |
$
|
227,958,830 | |||||||||||
July
2008
|
728,550 |
$
|
28.67 | 20,120,873 |
$
|
207,070,651 | ||||||||||
August
2008
|
174,109 |
$
|
28.48 | 20,294,982 |
$
|
202,111,928 | ||||||||||
Total
|
902,659 |
$
|
28.63 | 20,294,982 |
$
|
202,111,928 |
|
31.1
|
Certification
of Principal Executive Officer required by Rule 13a-14(a)
|
|
31.2
|
Certification
of Principal Financial Officer required by Rule 13a-14(a)
|
|
32.1
|
Section
1350 Certification of Chief Executive
Officer
|
|
32.2
|
Section
1350 Certification of Chief Financial
Officer
|
CINTAS
CORPORATION
(Registrant)
|
|||
Date: October
7, 2008
|
/s/
|
William C. Gale | |
William C. Gale | |||
Senior Vice President and Chief Financial Officer | |||
(Chief Accounting Officer) |